Stocks Plunge as NASDAQ Sinks to 3-Month Low

TL;DR

While the Nasdaq 100 closed down 2.1% and other U.S. equity markets also experienced losses, Dave Floyd discusses swing trading, his focus on specific instruments, and his objective approach to support and resistance levels in his trading strategy.

Transcript

welcome to the real vision daily briefing it's monday october 4 2021. i'm ash bennington joined today by dave floyd of aspen trading group let's talk a little bit about what's happening in these markets let's just be blunt not a great day not a great close looks like nasdaq 100 is the big loser on the day here off uh looks like about 2.1 uh closing... Read More

Key Insights

• ✋ The Nasdaq 100's underperformance and the struggle to make new highs indicate a potential change in the market dynamic.
• 🖤 The lack of dip buyers at attractive levels suggests a shift in market behavior among new generational traders.
• 😘 Rising yields in the bond market, despite expectations of lower yields, could signal a change in perception regarding transitory inflation.
• 🖤 The break of resistance levels in the 10-year treasury yield and the lack of bonds rallying during a stock sell-off are warning signs for the equity market.
• 🤑 The focus on the 10-year yield is common among traders as it represents the expectations of the smart money crowd.
• ☠️ Dave Floyd's swing trading strategy focuses on price action and correlation between rates and equities.
• 🍳 The break below support levels in dollar swiss suggests a bearish outlook, with a downside target of 91.50.
• 🧑‍💼 Gold's inability to rally significantly during market sell-offs and the shift of capital into cryptocurrencies may indicate a changing safe haven landscape.

Questions & Answers

Q: How does swing trading differ from other trading strategies?

Swing trading involves holding positions for several days to a week or two, allowing traders to take advantage of short-term trends.

Q: Why does Dave Floyd believe that a narrow focus on specific instruments provides an edge?

He believes that having an intimate knowledge of the instruments he trades gives him a feel for how they are trading.

Q: How does Dave Floyd's support and resistance strategy differ from subjective approaches?

While subjective approaches rely on finding points on a chart, Dave uses mathematically derived levels based on price and time, removing subjectivity.

Q: What does Dave Floyd expect from the market based on recent price action?

He believes the inability to break through resistance levels and the lack of dip buyers suggests more downside for the market.

Summary & Key Takeaways

• U.S. equity markets had a negative close, with the Nasdaq 100 losing 2.1%.

• Dave Floyd's trading strategy is swing trading, focusing on specific instruments like the S&P futures, ten-year note futures, and G10 currencies.

• He has evolved to an objective approach using mathematically derived support and resistance levels based on price and time.